UK February Retail Sales Rise at Fastest Pace in 3 Years, Says BRC

Retail sales in the UK have increased at their fastest annual rate in more than three years in February, as dry weather increased consumer footfall on the high street raising demand for goods such as clothes and home furnishings.

The British Retail Consortium (BRC) said that the total value of retail sales increased by 4.4 percent in February compared with a year earlier and up from a 2.3 percent growth in January.

On a like-for-like basis, retails sales rose by 2.7 percent year-on-year in February, compared to a 0.3 percent decline in the year-ago month, the fastest growth rate since December 2009.

Excluding distortions caused by the timing of Easter in previous years, total sales grew at the fastest rate since February 2010, BRC noted.

"After the disappointing figures that brought 2012 to a close, it's reassuring that the sales momentum established during an encouraging January has built not faded," Helen Dickinson, BRC director general, said in a statement.

"There are certainly highly-welcome signs here of gradual improvement and customers feeling a bit more positive. February saw growth across all parts of retailing, with big-ticket goods and items for the home recovering particularly well, possibly reflecting better conditions in the housing market."

Dickinson, however, added that a "permanent turnaround" in the retail sector is yet to come, and asked for more help from the budget this month to secure "real and lasting revival" by lifting consumer confidence.

"Consumers need a Budget that leaves them with more money in their pockets and the confidence to spend it and retailers with the means to invest," she said.

The sales of clothing, non-food and furnishing and flooring categories were strong during the month, as relatively dry weather lifted demand. Meanwhile, sales of food and drinks remained sluggish, especially as consumers change their buying habits within the meat sector, which suffered from the horsemeat scandal.

Online sales were up 10.9 percent over February 2012, when they had risen by 9.9 percent.

"The forthcoming Budget will be a pivotal moment for the retail sector. If the proposed rise in business rates goes ahead then retailers will be placed under inexorable pressure. However, if the Chancellor chooses to freeze rates, then he could give the sector some much needed breathing space to tackle the significant pressures it is facing," said David McCorquodale, head of retail at KPMG which assists BRC in preparing the sales monitor.

On 28 February, a survey by GfK NOP showed that consumer confidence in the UK remained unchanged in February with optimism about personal finances rising to the highest level in about two years.